Monday, 23 April 2012

DAILY TRADING STOCKS: JCY International, Astral Supreme


JCY’s daily chart
JCY may  trade  higher if it breaks above the resistance level. The stock has moved favourably after it was highlighted about a month ago. As expected, it met with resistance at RM1.40, the level that it failed to break convincingly in early February. Sellers initially had the upper hand early last week, where a “Bearish Engulfing” candle was formed last Tuesday. But buying interest returned and pushed it right to the RM1.40 level on Friday. A close above this level today will likely nullify the negative bias of the “Bearish Engulfing” candle and  see  the stock trading higher.  Positions can be initiated if  this happens with a stop loss on close below last week’s low of RM1.30. The target is the early-January high of RM1.50 and a strong move could see the test of RM1.60, the high of June 2010.  However, a failure to break above RM1.40 could see the return of selling, with a close below RM1.30 as the confirmation. Strong support is at RM1.07, where a violation may signal the end of the rally. Look for further support at RM0.94 and RM0.80, the Fibonacci retracements of the Oct 2011-Jan 2011 rally.

Astral’s daily chart
Astral may trade higher if it breaks the long-term resistance level. The stock is on a uptrend  since Aug 2011, as evidenced from the series of higher lows.  Nonetheless, it spent the last 1½ months consolidating the gains. The consolidation is now over on the back of the continuation of the upward movement, after 4 days of higher closes. It even closed right at the 3-year resistance level of RM0.27, highlighting the strength of the upward bias. A breakout could be in the offing as  the price strength was  accompanied  by  steady volumes, suggesting firm buying interest. Thus,  the  upward continuation is expected  on  a  close above RM0.28  and purchases can be made if this happens with a close below last Friday’s low of RM0.265 as a stop loss.  A conservative trade may choose the 3-day low of RM0.245 as a stop instead. The price target is the early 2009-high of RM0.365 and a strong move may even see the test of RM0.43 – the  support  level of 2007/2008 and also the measured move based on the 3-year consolidation. The trade may not work out should  the price close below RM0.245 and if this happens, it would take a while before a test of RM0.28 could take place again.

Source: OSK188

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